Talks to Shape Final Stimulus Bill Begin

February 11, 2009

By Tom IchniowskiThis story first appeared in Engineering News-Record

A mammoth economic-stimulus measure has advanced on its long, winding path through Congress, with the Senate’s approval on Feb. 10 of a $838.2-billion package that was pared back from an earlier version. The cuts that were needed to win enough votes to pass the bill included about $27 billion in construction funds. That left the final Senate bill with about $133 billion for construction programs, compared with about $160 billion in the bill as it cleared committee. The major construction casualty came in school-construction aid, where lawmakers deleted all $19.5 billion the original bill had recommended for K-12 and college projects.

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After the Senate’s 61-37 vote, just above the 60-vote minimum for passage, the focus now turns to negotiations to work out differences between the Senate bill and the $819.5-billion package that the House passed on Jan. 28. Democrats still want to have a final bill ready for President Obama’s signature by Feb. 16, but that will not be an easy task.

The bills are not that far apart in total spending, but the House has about $160 billion in total construction-related spending and the Senate $133 billion. The Senate measure has a greater emphasis on tax incentives than the House’s, and there are differences, including a few wide gaps, in the spending levels each recommends for specific programs.

Getting a Senate bill to the conference-committee talks required $108 billion of reductions from the proposals the Appropriations and Finance committees had approved in late January. Those cuts, $83 billion in Appropriations’ part of the package and $25 billion from Finance, were compiled by a group led by Senators Ben Nelson (D-Neb.) and Susan Collins (R-Maine). Democrats could count on 58 votes from their party and Independents. And when Democratic leaders backed the plan, they also picked up three GOP votes those of Collins, Olympia Snowe (Maine) and Arlen Specter (Pa.) to put them over the 60-vote threshold.

Construction industry officials now will lobby the stimulus-bill conferees to restore the Nelson-Collins cutbacks in construction and keep allocations for other public-works programs as high as possible. Steve Hall, vice president of government affairs for the American Council of Engineering Companies, says he is “a little disappointed with the [Senate] infrastructure number, compared to the House bill.” But Hall is pleased to see the bill move forward. “We may see an end point in sight,” he adds.

How The Revised Senate Bill Stacks Up for Construction (millions of $)

Program

House-passed Bill

Original Senate Bill

Revised Senate Bill

K-12 schools

14,000

16,000

0

Higher-education facilities

6,000

3,500

0

GSA Federal Buildings Fund

7,700

9,048

7,048

HUD public-housing stability/energy efficiency

2,500

3,500

2,250

HUD neighborhood stabilization

4,190

2,250

0

DOE loan guarantees/renewables

6,000

8,000

7,000

EPA Superfund

800

800

600

Bureau of Prisons buildings/facilities

0

1,000

800

U.S. Marshals Service/construction

0

125

100

FBI construction

0

400

300

Agriculture Dept. buildings/facilities

253

300

200

Agriculture Dept. watershed rehabilitation

50

120

65

Smithsonian facilities

150

150

75

Commerce Dept. bldg. renovation/modernization

0

34

0

Source: Office of Sen. Ben Nelson; ENR

A prime focus of the American Institute of Architects, Associated General Contractors and other groups is to have conferees adopt the House’s $6 billion for “greening” federal buildings and $14 billion for public schools in the final bill. “Not only are America’s schools in desperate need of repairs, but the money allocated in the House version of the bill would result in the creation of 400,000 jobs nationwide,” says Paul Mendelsohn, AIA vice president for government and community relations.

John McKeon, spokesman for the Construction Management Association of America, expects Obama will push to get school-construction funds in the final bill. “We would support that,” says McKeon. “We think that the schools are just as important as highways.”

School funding was one of the areas the President cited in a Feb. 9 press conference, much of which dealt with the stimulus. Obama recalled his visit to a 150-year-old South Carolina school next to a railroad line. He said it shook when a train went by and had an auditorium in such bad shape that it could not be used. Obama asked, “So why wouldn’t we want to build state-of-the-art schools with science labs that are teaching our kids the skills they need for the 21st century that will enhance our economy and, by the way, right now will create jobs?”

Industry officials also want to undo the Senate’s proposed reduction in the General Services Administration buildings program, which was sliced by $2 billion, to $7 billion. Of the $2-billion cut, $1.5 billion would come from energy-efficiency upgrades, leaving that “green buildings” category with $4.5 billion.

There was good news for construction elsewhere in the slimmed-down Senate bill. Several major categories escaped reductions altogether, including military and Dept. of Veterans Affairs projects, highways, transit and airports. The National Asphalt Pavement Association prefers the House’s $30-billion mark for highways to the Senate’s $27.1 billion, says Jay Hansen, vice president for government affairs. NAPA also favors the House’s $3 billion for airport construction grants over the Senate’s $1.1 billion.

Also untouched were the Environmental Protection Agency’s $6 billion for clean-water and drinking-water state revolving funds, the Corps of Engineers’ $4.6 billion for civil-works projects and the Dept. of Energy’s $5.5 billion for cleanups at former weapons facilities.

AGC also takes issue with a couple of proposed policy changes in the Senate bill. Jeffrey Shoaf, senior executive director for government and public affairs, says a provision to have the Federal Acquisition Regulation apply to the bill’s funding “will significantly slow down the state and local implementation of these funds.”

Another controversial issue before the conferees is reconciling differing “Buy American” provisions. The House bill takes a harder line, requiring all steel in infrastructure work financed by the stimulus to be U.S.-produced. The Senate specified that Buy American provisions “shall be applied in a manner consistent with U.S. obligations under international agreements.”

Shoaf says some federal programs already have Buy American rules, and the Senate language “will be confusing to federal, state and local governments” as they try to carry out the legislation.

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